Chinese business confidence brings New Hope to South Africa
- The commitment of giants like FAW Trucks boosts local investment
At an initial investment value of just over R200 million, the leading Chinese animal husbandry, animal feed and meat products manufacturer – New Hope Group – has established its first South African animal feed plant, going into pilot production at the beginning of December, to be followed with production for the agricultural market as from 05 January 2016.
CEO of New Hope South Africa (Pty) Ltd, Yang Zhao, explains: “South Africa was chosen because the country offered great infrastructure, a stable political environment and the opportunity for doing fair business while following the strict ethical standards demanded by our China-group headquarters.
“Furthermore, the fair trade practices and excellent business cooperation between China and South Africa have been very evident from the numerous Chinese giants that have established themselves in South Africa, like FAW Vehicle Manufacturers South Africa which chose to situate their plant in Coega, Eastern Cape, South Africa.”
“The New Hope Group, headquartered in Beijing, has fully owned subsidiaries on four continents and in 20 countries across the globe. In 2014 our worldwide group collectively sold 15 million tons of animal feed.”
“New Hope SA (Pty) Ltd will be providing the most affordable, high-quality animal feed to SA livestock farmers, with assurances of livestock growth and animal health equivalent to any of the better established brands.”
Being the new entrant into an existing market is challenging at best, but the parent Chinese New Hope Group chose carefully when deciding on the location of their second African subsidiary, the other being in Egypt.
“New Hope has not come to the South African market with thundering noise or loud fanfare, but we have taken the time to establish our first plant at the R59/R550 interchange in Randvaal Gauteng. This is a good start-up location; accessible to all the raw materials which we are sourcing locally only, thereby creating reciprocal business opportunities within the agricultural sector,” says Zhao.
Hope’s ethos is very community oriented. Yang Zhao affirms that they are here for the long haul, to share ‘space’ in their business model with local farmers and agricultural communities; to provide job opportunities for local people and to bring benefit to all partners associated with them.
The feed plant is poised for scaling to full production from January next year; and have put in place all the necessary regulatory and environmental controls required; the company has identified farmers for its supply chain and chosen suppliers and partners to support operations.
Their first five FAW commercial vehicles are ready to distribute the animal feed products, from the initial test production next month. The FAW-only fleet has been delivered and comprises three FAW 28.380FT bulk tanker units, one FAW 28.330FL 14-ton freight carrier and one FAW 15.180FL 8-ton freight carrier. The larger trucks have been fitted with bulk tankers to carry the 20 ton and 30 ton payloads, while the smaller units will service the bagged (50kg each) feed distribution.
“For now the vehicles will run within 150km radius from our plant in Gauteng, but will on occasion also run supplies to Namibia, Botswana and Swaziland. As our feed production volumes increase towards reaching our full capacity of 200 000 tons per annum, our fleet will grow together with our distribution radius – probably up to 400km.
“We are already considering investing in another four plants, with the second plant most probably situated in the Northwest Province, South Africa.
“Our greatest considerations when choosing FAW trucks were reliability and uptime; reasonable cost of ownership and an understanding that we will be a customer with high expectations. However, having said this, we demand from FAW Trucks SA no more than we expect of ourselves, after all we work and live by similar goals – to provide quality products at an affordable price, with superior aftersales service and support.”